Gams v. Houghton

• Decision Date: 31 August 2016
• Docket Number: No. A14–1747.,A14–1747.
• Citation: 884 N.W.2d 611
• Parties: Ferdinand Leo GAMS, Jr., Respondent/Cross–Appellant, v. Steven Ronald HOUGHTON, Appellant/Cross–Respondent.
• Court: Minnesota Supreme Court

884 N.W.2d 611

Ferdinand Leo GAMS, Jr., Respondent/Cross–Appellant,

v.Steven Ronald HOUGHTON, Appellant/Cross–Respondent.

No. A14–1747.

Supreme Court of Minnesota.

Aug. 31, 2016.

Kay Nord Hunt, Lommen Abdo, P.A., Minneapolis, MN; and Carver Richards, Honkanen Richards, S.C., Virginia, MN, for respondent/cross-appellant.

Jerome D. Feriancek, Ryan C. Stutzman, Thibodeau, Johnson & Feriancek, PLLP, Duluth, MN, for appellant/cross-respondent.

Charles F. Webber, Faegre Baker Daniels LLP, Minneapolis, MN; and Daniel J. Cragg, Eckland & Blando LLP, Minneapolis, MN, for amicus curiae Minnesota State Bar Association.

OPINION

GILDEA

, Chief Justice.

In this case, we are asked to decide whether Minn. R. Civ. P. 60.02

applies to a Minn. R. Civ. P. 5.04(a) “deemed” dismissal, and whether such a dismissal violates procedural due process. The district court concluded that Rule 60.02 is inapplicable to a dismissal under Rule 5.04(a) or, alternatively, that respondent Ferdinand Leo Gams, Jr. failed to establish all four requirements for relief under Rule 60.02, see

Finden v. Klaas, 268 Minn. 268, 128 N.W.2d 748 (1964). The court of appeals reversed and remanded for reconsideration, rejecting the district court's conclusions that Rule 60.02 was inapplicable and that all four Finden prongs¹ must be established in order for relief to be warranted. Gams v. Houghton, 869 N.W.2d 60, 61 (Minn.App.2015). Because we conclude that Rule 60.02 applies to a dismissal under Rule 5.04(a), that a dismissal under Rule 5.04(a) does not violate procedural due process, and that the district court failed to make findings sufficient to enable appellate review of its Rule 60.02 ruling, we affirm as modified.

On February 4, 2013, we filed an order adopting amendments to Rule 5.04

, including Rule 5.04(a), the amendment now at issue.² Order Adopting Amendments to the Rules of Civil Procedure and General Rules of Practice Relating to the Civil Justice Reform Task Force, Nos. ADM10–8051, ADM09–8009, ADM04–8001 (Minn. filed Feb. 4, 2013) (“Order Adopting Amendments”). This amendment altered a long-standing Minnesota practice that permitted a party to commence an action simply by service of the summons upon the defendant. Filing the case with the district court was not required. Rule 5.04(a) amended this practice by requiring that all non-family cases be filed with the district court, or a stipulation obtained extending the time for filing, within 1 year from the commencement of the action. Rule 5.04(a) was effective as of July 1, 2013 and applies to “all actions or proceedings pending on or commenced on or after the effective date.” Id. But for actions pending when the amendment became effective, we provided a 1–year grace period. In other words, parties with pending actions had 1 year to file such actions in district court. Our Order makes this grace period clear: “(a) No action shall be involuntarily dismissed pursuant to Minn. R. Civ. P. 5.04 until one year after the effective date.” Id.; see also Order Relating to the Civil Justice Reform Task Force, Authorizing Expedited Civil Litigation Track Pilot Project, and Adopting Amendments to the Rules of Civil Procedure and the General Rules of Practice, Nos. ADM10–8051, ADM09–8009, ADM04–8001 (Minn. filed May 8, 2013) (adopting the final version of the amendments). Information on Rule 5.04(a)'s effective date and its applicability to pending actions is published in the “Historical Notes” section of the Minnesota Rules of Court.

This case was pending when Rule 5.04(a)

went into effect. The case arises from a physical altercation that occurred on January 14, 2012, between Gams and appellant Steven Ronald Houghton, who are brothers-in-law. On March 22, 2013, Gams commenced the present action against Houghton by service of a summons and complaint. See Minn. R. Civ. P. 3.01(a). In the complaint, Gams raised claims of negligence, assault, and battery.

From April 2013 through February 2014, the parties actively litigated this case, exchanging various discovery requests and responses. In May 2014, Gams and Houghton discussed the possibility of mediation or arbitration of liability, and reached a tentative stipulation on damages in the amount of $85,000. On July 17, 2014, Gams's counsel sent a follow-up letter asking whether Houghton had made any further decisions regarding resolution of the matter. A short time later, Gams's counsel received a letter dated July 15, 2014, stating: “The new Rule 5.04

took effect July 1, 2014. Therefore, the case is deemed to be dismissed with prejudice, and we consider the matter closed.” Gams's counsel stated that he was “unaware” of the amendment.

On August 6, 2014, Gams mailed the summons, complaint, and affidavit of service to the district court. The court accepted the filing on August 7. That same day, the court sua sponte ordered the dismissal of the action with prejudice pursuant to Rule 5.04(a)

. The court administrator entered the judgment of dismissal the following day.

On August 27, 2014, Gams moved to vacate the judgment, contending that Rule 5.04(a)

violated his right to procedural due process and, in the alternative, that relief was warranted under Rule 60.02(a) due to “excusable neglect.” More specifically, Gams argued that his neglect in failing to comply with Rule 5.04(a) was excusable because he reasonably relied on his attorney, and in addition the parties were actively litigating the case and were rapidly moving toward a possible settlement.

The district court denied Gams's motion to vacate, concluding that “Minn. R. Civ. P. 60.02

does not apply to a Minn. R. Civ. P. 5.04 dismissal.” In the alternative, the court, without explaining its reasons, concluded that Gams failed to establish all four requirements for relief, see

Finden, 268 Minn. at 268, 128 N.W.2d at 748. The court did not address Gams's due process argument.

The court of appeals reversed and remanded. Gams, 869 N.W.2d at 61

. Specifically, the court of appeals concluded that Rule 60.02 applies to dismissals under Rule 5.04(a), reasoning that “[n]othing in the plain language of either rule precludes a party from seeking relief.” Id. at 63. Having concluded that Rule 60.02 applies, the court of appeals remanded. Id. at 65–66. According to the court of appeals, the district court operated under the erroneous assumption that a party seeking relief under Rule 60.02 must satisfy all four Finden requirements and, because the district court failed to make express findings on each of the requirements, further consideration under the appropriate test was necessary. Id. at 64–66.

We granted Houghton's petition for review to address whether Rule 60.02

is applicable to a dismissal under Rule 5.04(a) and, if so, whether the district court abused its discretion in denying relief. We additionally granted Gams's request for conditional cross-review regarding the constitutionality of Rule 5.04(a).

I.

We turn first to Houghton's assertion that Rule 60.02

is inapplicable to a dismissal under Rule 5.04(a)

. Minnesota Rule of Civil Procedure 5.04(a), the rule under which Gams's action was dismissed, provides, in relevant part, that “[a]ny action that is not filed with the court within one year of commencement against any party is deemed dismissed with prejudice against all parties unless the parties within that year sign a stipulation to extend the filing period.” (Emphasis added.) Because Gams commenced his action on March 22, 2013, prior to the effective date of Rule 5.04(a), Gams had until July 1, 2014 to file his action with the court. Order Adopting Amendments, Order at 1 (providing that cases commenced before the effective date, July 1, 2013, would not be involuntarily dismissed under Rule 5.04 until July 1, 2014). Following Gams's belated filing on August 7, 2014, the district court, by order, sua sponte dismissed the action with prejudice under the rule.

Gams subsequently moved for relief under Minn. R. Civ. P. 60.02(a)

. Minnesota Rule of Civil Procedure 60.02(a) provides that “[o]n motion and upon such terms as are just, the court may relieve a party or the party's legal representatives from a final judgment (other than a marriage dissolution decree), order, or proceeding” for “[m]istake, inadvertence, surprise, or excusable neglect.” The district court denied Gams's motion, but the court of appeals reversed and remanded for reconsideration, Gams, 869 N.W.2d at 66.

Houghton argues on appeal that the plain language of Rule 5.04(a)

precludes a district court from granting relief under Rule 60.02. The interpretation of the Minnesota Rules of Civil Procedure is a question of law that we review de novo. Madson v. Minn. Mining & Mfg. Co., 612 N.W.2d 168, 170 (Minn.2000). When interpreting court rules, we look “first to the plain language.” Walsh v. U.S. Bank, N.A., 851 N.W.2d 598, 601 (Minn.2014). We interpret the words of a court rule “ ‘in the sense in which they were understood and intended at the time the rule was promulgated.’ ” Nguyen v. State Farm Mut. Auto. Ins. Co., 558 N.W.2d 487, 490 (Minn.1997) (quoting House v. Hanson, 245 Minn. 466, 473, 72 N.W.2d 874, 878 (1955) ). If the language of a rule is plain and unambiguous, we follow the rule's plain language. Walsh, 851 N.W.2d at 601. A rule is ambiguous only if the language of the rule is subject to more than one reasonable interpretation. Id.

The plain language of the rules confirms that Rule 60.02

applies to dismissals under Rule 5.04(a). Rule 60.02 is broad, stating that it applies to “final judgment[s] ... order[s] [and] proceeding[s],” except for “marriage dissolution decree[s].” That the rule contains only one exception—for marriage dissolution decrees—confirms that the rule otherwise applies. In other words, because Rule 60.02 expressly excludes “marriage dissolution decree[s],” but not dismissals under Rule 5.04(a), Rule 60.02 applies to Rule 5.04(a) dismissals. See

City of Saint Paul v. Eldredge, 800 N.W.2d 643, 648 (Minn.2011) (noting that this court has long...